- ISDA Member banks vote unanimously (15-0) that Greek restructuring credit event has occurred
- Auction on outstanding CDS transactions to be held March 19th
In light of today’s EMEA Determinations Committee (the EMEA DC) unanimous decision in respect of the
potential Credit Event question relating to The Hellenic Republic (DC Issue 2012030901), the EMEA DC
has agreed to publish the following statement:
The EMEA DC resolved that a Restructuring Credit Event has occurred under Section 4.7 of the ISDA
2003 Credit Derivatives Definitions (as amended by the July 2009 Supplement) (the 2003 Definitions)
following the exercise by The Hellenic Republic of collective action clauses to amend the terms of Greek
law governed bonds issued by The Hellenic Republic (the Affected Bonds) such that the right of all
holders of the Affected Bonds to receive payments has been reduced.
The EMEA DC has resolved to hold an auction with respect to the settlement of standard credit default
swaps for which The Hellenic Republic is the reference entity. To maximise the range of obligations that
market participants may deliver in settlement of any such credit default swaps, the EMEA DC has agreed
to run an expedited auction process such that the auction itself will take place on March 19, 2012. In
light of this expedited auction process, market participants should submit any obligations that they
would like to include on the list of deliverable obligations to ISDA as soon as possible.
EMEA Determinations Committee Decision 09032012
33 comments:
Anyone else notice that all ‘half-gallon’ carton drinks and OJs at the stores are now just 59 Oz (instead of 64 Oz)? That’s an 8.5% price increase (inflation) without anyone even noticing! Apparently, this started in 2010, but hardly anyone has even noticed. Sort of like inflation of the fiat paper 'money' supply.
They have to be making billions off this somehow, they wouldnt never call it a credit event without huge benefit to the ISDA.
@4:44pm
on schiffradio yesturday a guy emailed peter informing him that he's been tracking the cost of milk for 2+ years and that the price has gone up like some 30+% in just a couple years. but dont worry theres no inflation.
- runlevel
They probably already made the billions on the currency trade between the Euro and USD and the equities swings. They just needed a bunch of "Greece is saved!", "Greece is doomed!" cycles to fleece the forex traders and the the WS daytraders.
I wonder if the threat of the "loophole" thingie had something to do with ISDA throwing in their cards?
nb
And so it begins. The acceleration of what is to come. The coffee has brewed and now is scorching. If you can't smell it by now, I'm afraid you are probably to late.
2 OZ.
The fuckin goose is cooked!
So the banks will now have to pay out? Will they Sandra Fluke everyone and find another way not to pay?
Big question now is do we get the domino effect.
ah forget about all this shit...lets watch some hockey eh..
The Bernake better get the printing presses fired up big time.
Note how ISDA waited until the end of the U.S. trading day (and week.)
They can't allow a major spike in the precious-metals charts. Will the charts react on Monday?
They know that this tried-and-true tactic will mute the chart response, expected on Monday.
The mainstream news just announced that greece finance minister said 86% of bondholders signed on which triggers the cac clauses that boosts participation to 95.8%
So...Unless I haven't learned anything about how this works.....I'd say this means the banks that underwrote all the CDS have to pay out only roughly 4000 claims....about 3 billion
BUT, the CDS market going dorward survives.
There are several more countries, with much larger problems lining up for the "free" money.
a)greece was just a dress rehersal to see if the CDS system would hold up and the greed mongers would jump on the CDS train. They did, but I predict they won't all get paid anyway.
a) the big underwriters will pay out the claims on the greece "event" Greece will still default down the road.......as planned, then their gold is GONE.
b)the process will move on to the next country and start the whole process again.
c) Once the CDS speculators are well and goodly indoctrinated, it will all fall apart around one of the larger countries, where some REAL money will be lost.
Correct me on any and all points if you can. It's all very confusing
Crazy Canuck
ISDA did not declare it a default doc... the word default is nowhere to be seen in that statement.
Will all those 0000s and 111111s pumped into the ECB stop any of this?
Will the small percentage of payouts prevent the 5 major banks in the US from failure?
nb
Jim Willie, Who?
-Hotsaucze
Note on ZH that Austrian bank KA Finanz (or something like that) has ass-caught-in-crack of about $1 billion Euros or nearly 30% of the left over default obligations of the Greek thingy--credit boo or whatever they will call it for the history books.
A sick bank backed by the Austrian gov will need some bailing out. But in reality, the Greek economy and austerity measures will kill any chance of this bailout effecting lasting security for the banks.
Something is definitely fishy with this - there's no way they'll be paying out on all the outstanding CDS contracts. Just more smoke and mirrors, the DOW will probably be back over 13k on Monday. What a sham.
Silverstax
Yep, my guess is that this is the "hook" to keep the everyone in the game otherwise they would all bail on the rest of the PIIGS. Every con game pays out in the beginning to sucker in the real money.
These people aren't stupid. They are not willing to lose their golden goose over a tiny little country like Greece when there are bigger fish to fry...
PhilAZ
Jim Sinclair says the CDS is going to be on the order of $15 trillion or so. Ooops.
Hey Benny print print print.
Hey CC.
I happen to agree with your assessment. Great synopsis. It is the only thing that makes sense for now. As we go forward, I am sure we will be privy to some of the back room dealings.
Ordinary Joe
I agree with CC too, I think this is just more can kicking... they had the choice of letting the system blow up (by denying the 'credit event' as Jim Sinclair was saying) or they could let Greece get away with this and save the real battle for when Italy blows up... anything to keep the system going one more day, and then when they've finally reached the end of the road we'll see the QE to Infinity that JS talks about.
Bix was right about this....alot of people owe him an apology regarding Greece, which I know he'll never receive....
-Cleburne61
...Sinclair called the event more than a month ago I believe. Two days off the mark with the auction on the 19th.
Beacon
well said, phil. we're awaiting the sting on the mark!
The only guy who knows what the hell is going on with this is Sinclair. He says this will not be a liquidity event like a Lehman. This should poor gas on the fire of the metals prices.
lol
Just watch the PM's get taken down hard by late afternoon EDT.
I think you are wrong ANON 7:17. A take -down won't last long at all if it happens at all. I hope it drops like a rock. I haven't reached my target of PHYZZ yet. A take-down will help me. A stack-attack for me will be nice and the Asians will help me take even more phyzz off the market.
2 OZ.
@Cleburne61-
Exactly how was Bix right about Greece that everyone else discounted?
3 billion in CDS triggered...nothing to see here...yet.
Toronto, Ontario
With unemployment climbing, production and consumption tanking, businesses shutting down, and tourism nose-diving, there is only one way for tax revenues: down. Budget deficits will be worse than promised. Greece’s debt—now largely to taxpayers of other countries—will continue to balloon. The standard of living of the vast majority of Greeks will get slammed, though the elite that are negotiating these deals will do just fine.
“We still don’t have a solution for Greece, so there will be a harder default to come,” predicted Charles Wyplosz, director of the Geneva-based International Center for Money and Banking Studies. Yet, in a bitter irony, Germany—the country where tax dodging is a national sport—decided to send 160 employees of its Ministry of Finance to Athens to fix the tax collection system. For that whole debacle that will endear the already reviled Germans even more to the Greeks, and for just how long a tax dodger can abuse the courts....
http://www.zerohedge.com/contributed/2012-10-09/greece%E2%80%94%E2%80%9C-harder-default-come%E2%80%9D
Toronto, Ontario
COME ON BABY I WANNA SEE SOME FIREWORKS!!
He was right in his call that a trigger of CDS's would occur, and that they would use default language. It did, and they have.
Most others said they'd never declare it. Here we are.
Let's wait and see what the next two weeks bring us, now that that's over.
-Cleburne61
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